Mykolaiv plans to spend ₴1.3 million on insurance for members of the water utility’s supervisory board

The Supervisory Board of the municipal enterprise «Mykolaivvodokanal», photo: Vodokanal

In Mykolaiv, there are plans to allocate 1.3 million hryvnias for liability insurance for members of the supervisory board of the municipal enterprise «Mykolaivvodokanal».

The relevant draft resolution was considered by the City Council’s Executive Committee on 24 June, according to NikVesti.

Such insurance is provided for in the utility’s articles of association, the contracts of the supervisory board members and the regulations governing its activities, noted Ihor Nabatov, deputy director of the Department of Housing and Communal Services.

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«This figure is quite substantial at present — 1.3 million hryvnias a year. But this applies to all members of the supervisory board,» said the official.

Initially, the city was considering proposals under which insurance for a single member of the supervisory board could cost around 1 million hryvnias a year, he added.

«To put it into perspective, when we first started looking into this situation, it would have cost around 1 million hryvnias per member of the supervisory board. We then began talking to various insurance companies and found an option that allows us to insure all members of the supervisory board for 1.3 million hryvnias,» said Ihor Nabatov.

According to him, the insurance is intended to cover risks associated with decisions made by members of the supervisory board.

«For example, if decisions made by members of the supervisory board result in losses for the municipal enterprise, this constitutes grounds for holding them financially liable. The insurance will cover such costs,» explained the official.

He added that, whilst there have been no such cases at the company to date, members of the supervisory board do make decisions that could have financial consequences for the company.

«We have not had any such situations so far, and I hope we never will. But serious decisions are being taken at the moment. Therefore, such insurance is necessary and standard practice.

In order to resolve this issue once and for all and enable the water utility to procure this service, this draft decision of the city council’s executive committee has been prepared,» said Ihor Nabatov.

The supervisory board of Mykolaivvodokanal

The municipal enterprise «Mykolaivvodokanal» has become the first municipal enterprise to have a supervisory board in place. This is a collegial body which exercises strategic oversight of the enterprise’s activities, approves key management decisions and financial plans, and evaluates the performance of the management. It does not interfere in day-to-day operations; it influences the appointment and evaluation of the director, but will not dismiss or hire staff at other levels.

The decision to establish supervisory boards in Mykolaiv’s municipal enterprises was adopted in 2024 as part of corporate governance reform. Yuliia Mincheva, an external adviser to the Mayor of Mykolaiv, noted that the supervisory boards would nevertheless be governing bodies, rather than advisory ones, and would bear responsibility for the decisions taken. They will have both legal and financial responsibility for their actions.

In January 2025, a competition was announced to select independent members, and on 29 May 2025, the City Council approved its composition.

The supervisory board of the municipal enterprise «Mykolaivvodokanal» comprises five members, including:

1. Andrii Haidutskyi (Ukraine), Doctor of Economics, Master of International Economic Relations (Taras Shevchenko National University of Kyiv) and MBA specialising in strategy and corporate governance (KDI School, South Korea).

2. Andrii Yefimov (Ukraine), who holds a Master’s degree in Banking and has over 20 years’ professional experience in finance, risk management and corporate governance.

3. Serhii Shkliar (Ukraine), Doctor of Law, specialist in international law (Institute of International Relations, Taras Shevchenko National University of Kyiv) and business economics.

4. Bjørn Kaare Jensen (Denmark), a European expert in water resource management with nearly 40 years’ professional and executive experience.

5. Hanna Montavon (Ukraine), founder and director of Mykolaiv Water Hub, a lawyer with international experience, specialising in water infrastructure, public-private partnerships and legal support for municipal development.

In fact, a month ago in May, the utility’s Supervisory Board officially approached the National Agency for the Prevention of Corruption with a request to carry out an unscheduled audit.